Once we have managed to save a little, we usually ask ourselves a question: What to do with our money? Well, for those people with little knowledge about the world of finance, the best option is to go to a professional who knows about economics and the markets. This can help us find the product that best suits our needs. If you want to know what a financial advisor is and what he does, I recommend that you continue reading.
In this article we will not only explain what this profession is about, but we will also comment on what its functions are, where it works and even how to become a financial advisor, if we are interested in it. I hope this information will help you clarify all your doubts regarding this topic.
What is the role of a financial advisor?
When we speak of financial advisers, we refer to professionals whose objective is help manage the economy of a company or a person, always according to the assets, needs and income of the client in question. In other words: They are in charge of managing the financial operations of the company or person who hires their services.
Now that we have a clearer idea of what a financial advisor is, we must be careful not to confuse it with a financial agent. The latter generally has a more global vision regarding the economy. The function of the same is more like that of an external and punctual financial consultant. However, The financial adviser regularly monitors his client's movements, trying to help him achieve his goals. In addition, he has the ability to recommend various financial products that he himself knows and manages.
If we refer to an independent financial advisor, he receives a fixed salary from his client, without commissions. Usually, It is the most recommended option for large estates. In this case, the main functions of the professional are the following:
- Help customers to achieve your financial goals.
- Offer to customers adapted financial products to them, according to their risk profile.
- Accompany and advise clients regarding your investment decisions.
Where does a financial advisor work?
Apart from being able to work for free, as we have mentioned before, the financial advisor also You can be part of a company or work in a bank. Depending on where you are, their functions vary. Being hired, it is normal to charge commissions.
When the professional is employed in a company, Its objectives are the following:
- Help make decisions about investments. For that it is essential that you make use of your knowledge about the markets and finances.
- Assess the earnings of the company.
- Increase the capital belonging to the company. To do this, you must look for new strategies and tools that help achieve this goal.
On the other hand, if the financial adviser works in a bank, its functions are others:
- Select products tailored for customers, based on your risk profile. It is a commercial function to establish relationships with the bank's clients.
- Find new opportunities to manage the funds marketed by the bank.
What does it take to be a financial advisor?
Now that you know what a financial advisor is, you will probably have come to the conclusion that the salary for this profession is not bad, at least for the current situation in Spain. Therefore, it is not surprising that more than one person thinks about looking for job offers for this position. But what requirements must be met to be able to say that we are financial advisors?
It is clear that the most basic have a lot of knowledge about the world of finance and the economy in general. In addition, it can be very useful to have certain qualities in the field of psychology, as it will help to study the market and better understand people and, consequently, customers. It is also essential be able to determine the risk profile of each investor. Without this ability, we will not be able to develop a personalized advice plan or accompany clients in times of crisis.
We can't let go a series of knowledge that are basic to be able to carry out the work of a financial advisor. They are the following:
- Tax knowledge: It is important to be informed about current regulations. Without this, it will not be possible to create a fiscal plan that takes into account the variables of each client, such as inheritance tax, IRPF, protected assets, etc.
Finance knowledge: It is essential to know how to interpret the indices whose behavior affects the assets in which the client has invested.
How much does it cost to hire a financial advisor?
Generally, people believe that a financial adviser only pays the high net worth. Nevertheless, also offers services to small savers. In fact, every time a person hires a product in a bank, a small percentage of what they pay goes towards hiring this service.
When looking for a financial advisor, It is best to look for an independent one, for a very simple reason: Dependent advisors are subject to the requirements and conditions imposed by the bank. Obviously, the bank is interested in selling its own products and thus meet its commercial objectives. Therefore, advice given to us by dependent financial advisors may be affected by a conflict of interest.
What is the salary of a financial advisor?
We already know what a financial advisor is, what its functions are and how to become one. However, one big question remains to be answered: How much does a financial advisor earn? As well, The average salary of this professional is around €46.500 gross per year, which is well above the average annual salary in Spain. Per month, a financial advisor earns around €2.520 net. Not bad, right?
In conclusion we can say that financial advisors are key if we want to meet economic objectives. They are not only of great help for companies, but also for individuals, especially for those who do not know much about the world of finance or who simply do not have time to be constantly aware of the markets. Yes indeed, It is of utmost importance that the financial advisor is qualified. The knowledge you must have is not easy at all, so it is essential that you have some training in the field of economics.